Tuesday, April 6, 2010

Microsoft has lost another round in the ongoing patent infringement lawsuit filed by i4i, a Toronto-based developer of collaborative content solutions and technologies.

The suit, filed March 2007, alleges Microsoft infringed on an i4i-patented technology that creates a "metacode map" allowing "a computer to manipulate the structure of a document without reference to content," according to the patent. i4i claims in the lawsuit that Microsoft infringed on the patent when it introduced a version of Word in 2003 with XML editing capabilities.

Last year, a federal court jury in Texas awarded i4i $290 million in damages, plus interest and court costs. The court also ordered Microsoft to stop selling future versions of Word that contain the technology. Microsoft subsequently issued a patch for Word 2007 and 2003 disabling the technology, but appealed the ruling.

In December 2009, the U.S. Court of Appeals for the Federal Circuit upheld the ruling and injunction against selling Word versions containing the disputed technology. Microsoft's appeal was based on trial procedure precedents, according to court documents.

On Wednesday, the court issued a revised opinion upholding the lower court's trial procedures and ruling, as well as offered a more detailed analysis, saying that "Microsoft willfully infringed on i4i's patent."

"This is a very good result for us in our ongoing pursuit to protect our company's patent on this technology," said Loudon Owen, chairman of i4i, in a telephone interview. "The fact that the three judges found that Microsoft willfully infringed on our patent is obviously a good sign, but it's not the end of the line."

Owen said he expects Microsoft to pursue its appeal all the way to the Supreme Court.

A Microsoft spokesperson said by phone that "Microsoft is not officially commenting on the case," but added that Microsoft will pursue an "en banc" review of the ruling by a full panel of 12 judges.

Owen speculated that it would take a consensus of seven judges to overturn the ruling, and said i4i is fully prepared to continue a long-term effort to protect its assets and build its company.

"It has been a drain on our resources, there's no question, but we believe in the technology and we are looking forward, not backward," Owen said. "We have an injunction [to stop Microsoft], we have a product, we have an award of $290 million dollars plus interest, and we have an opportunity to build our business."

An en banc review is expected to be filed in the Federal Court of Appeals in the near future, according to an i4i statement and sources close to Microsoft.